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MaureenM1 (PA)
Posts: 344
Posted:
Myself and my neighbor are newly elected Board Members of our development. Per our declaration & bylaws Board Members are suppose to be informed of potential renters and receive a copy of the lease. The problem is the builder owns 8 of 24 units and is renting 6 with the possiblity of renting two more. Just last week a new renter moved in without us being notified( as board members) and approving the renters. The builder already has advertisements for rental on units that he is currently building.

Owners have informed me they are very dissatisfied with the builder because when we purchased we were told that our development was not going to be a "rental" community, however, it states in the bylaws that the declarant can rent all units he does not sell. He has 16 more units to sell so potentially he can build them and rent all of them which would make out development more renters than owners. We are still under declarant control and with the builder keeping a majority of the units for himself do not see how we will EVER gain control of the association???

The owners feel that their quality of life is being compromised and that the continue rentals by the builder is bringing down their home values. The builder is renting for $600.00 a month less than comparable townhouses in our area. They feel when potential buyers find out how many renters are in the development they will not want to purchase.

They want to see advice for legal counsel to see what their options are? I know we would need an attorney with condo law/real estate law experience. Any thoughts on this???
MaryA1 (Arizona)
Posts: 7,043
Posted:
Quote:
Posted By MaureenM1 on 09/01/2008 8:11 AM
Myself and my neighbor are newly elected Board Members of our development. Per our declaration & bylaws Board Members are suppose to be informed of potential renters and receive a copy of the lease. The problem is the builder owns 8 of 24 units and is renting 6 with the possiblity of renting two more. Just last week a new renter moved in without us being notified( as board members) and approving the renters. The builder already has advertisements for rental on units that he is currently building.

Owners have informed me they are very dissatisfied with the builder because when we purchased we were told that our development was not going to be a "rental" community, however, it states in the bylaws that the declarant can rent all units he does not sell. He has 16 more units to sell so potentially he can build them and rent all of them which would make out development more renters than owners. We are still under declarant control and with the builder keeping a majority of the units for himself do not see how we will EVER gain control of the association???

The owners feel that their quality of life is being compromised and that the continue rentals by the builder is bringing down their home values. The builder is renting for $600.00 a month less than comparable townhouses in our area. They feel when potential buyers find out how many renters are in the development they will not want to purchase.

They want to see advice for legal counsel to see what their options are? I know we would need an attorney with condo law/real estate law experience. Any thoughts on this???

Maureen,

Who's to say the "board" isn't being informed of these rental units? You say you're still under declarant control, so isn't the declarant (the developer) the pres of the board? If you thoroughly check your gov. docs. I'm sure you will find that the declarant has certain rights which cannot be taken away as long as he owns any lots, perhaps even just one. It's not unusual for a developer to build in certain protections into the gov. docs. for "the protection of his investment". You may contact an attorney -- at your own expense, as I'm sure the pres of the board will not authorize it! -- but I doubt he'll be able to do anything for you.

We're hearing more stories such as yours. It's just a sign of the times. As you know the r.e. market is at an all time low; it's almost impossible to sell anything in many areas. Isn't it better to have these unsold units occupied rather than left empty? Vacant homes doesn't look good when trying to attract buyers either.

BTW, what does "approving" a renter entail? You know there are Fed. discrimination laws.
MaureenM1 (PA)
Posts: 344
Posted:
Yes, I do know there are Fair Housing Laws, however, is it fair to owner's home values when the builder is renting homes in a development for $600.00 less a month than comparable townhome developments???

Approving mean that the lease is in order and that the tenants are aware of the bylaws, etc.
JohnK3 (Pennsylvania)
Posts: 967
Posted:
Maureen,

While I appreciate your personal concerns, fairness will be found in your docs, which you agreed to. From what you've outlined, looks like you're stuck with a bad situation without many options. If a copy of the lease + renters being informed of the docs is the issue, that's one thing that the developer can easily establish. As far as property values, only the marketplace will make things better or worse. Good luck, though.

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